CBN Inaugurates ACGSF Board to Transform Agriculture Financing

News in brief:

-CBN Governor Olayemi Cardoso inaugurated the new ACGSF Board, calling for a transformative, technology-driven agricultural financing model.

-The board is tasked with expanding affordable credit to smallholder farmers, deepening financial inclusion, and modernising loan monitoring systems.

The Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, has inaugurated the newly reconstituted Board of the Agricultural Credit Guarantee Scheme Fund (ACGSF), describing the event as a defining moment for agricultural financing and a bold declaration of the bank’s commitment to revitalising the sector.

Speaking at the ceremony, Cardoso said the inauguration signals a 'new dawn for agricultural financing' that will prioritise innovation, inclusion, and strategic leadership.

Agriculture Critical to Nigeria’s Economy — Yet Underserved

Cardoso noted that despite agriculture contributing more than one-fifth of Nigeria’s GDP and employing nearly two-thirds of the workforce, the sector still receives less than 5% of total bank credit.

He stressed that the country’s millions of smallholder farmers, who constitute 80% of all food producers and account for 90% of locally produced food, continue to face persistent barriers in accessing affordable credit.

He said the CBN is now determined to correct the longstanding structural gap.

“We will no longer accept business-as-usual. Agriculture must take its rightful place in our financial system and national priorities,” Cardoso stated.

ACGSF to Evolve Into a Modern, Forward-Looking Financing Vehicle

Cardoso highlighted the historic role of the ACGSF, established under Decree No. 20 of 1977, in guaranteeing up to 75% of agricultural loans, an intervention that helped banks lend to previously 'unbankable' farmers.

However, he stressed that modern agriculture is far more complex today, characterised by expansive value chains, advanced technology, climate and security risks, and diverse actors from cooperatives to agritech startups.

He said these realities require the ACGSF to expand its capacity and modernise its operations, especially following the 2019 amendment, which raised its share capital from ₦3 billion to ₦50 billion and broadened its mandate.

The new board, now featuring seven members, including representatives of Nigerian farmers, will offer more inclusive and responsive governance.

Aligning With Renewed Hope Agenda for a Modern Agricultural Economy

According to Cardoso, the inauguration aligns with the Federal Government’s Renewed Hope Agenda, which aims to build a resilient food system, a technologically driven agricultural economy, and an inclusive environment that creates wealth and reduces poverty.

He emphasised that Nigeria must decisively bridge the financing gap limiting agricultural potential, especially for farmers without collateral or credit history.

“These smallholders feed our nation. The ACGSF must transform into a catalyst that expands affordable lending for modern inputs, storage, mechanisation, irrigation, and value addition,” the financing expert said.

Board Charged With Expanding Financial Inclusion and Supporting Women, Youth

Cardoso urged the newly inaugurated board to prioritise underserved groups, such as rural farmers, women, and young agripreneurs.

He cited research showing that nearly 60% of rural women do not use mobile internet, limiting access to digital services and credit.

Meanwhile, he has called for targeted products developed in partnership with microfinance banks, cooperatives and fintech companies.

“Lack of collateral or remote location must no longer be a barrier. Every viable farmer should find an enabling partner in the ACGSF," he said.

Data, Technology, and Real-Time Monitoring Now Central to ACGSF Strategy

Cardoso outlined the need for a stronger monitoring framework to ensure guaranteed loans deliver measurable results. He encouraged the board to deploy digital tools for real-time tracking, including satellite imagery to monitor crop performance, digital dashboards to track loan disbursement and repayment, as well as data-driven early warning systems to identify risks such as regional loan defaults.

He said this will strengthen transparency, reduce misuse of funds, and ensure that guaranteed loans drive productivity and farmer welfare.

Ensuring Accountability, Impact, and National Food Security

Cardoso added that the board must ensure loans are used for their intended purposes and provide feedback for continuous improvement. He emphasised that quick identification of bottlenecks and regional risks will allow for timely interventions, including borrower training or strategic adjustments.

He stressed that the ACGSF must become 'the cornerstone of Nigeria’s agricultural transformation,' working closely with other government initiatives to ensure credit reaches the grassroots and catalyses meaningful growth across value chains.